State-run Korean asset management company (Kamco) is to buy 62 vessels from shipping firms in South Korea through its $3.1bn fund to free up cash for the troubled companies.

The fund has been set up with contributions from local banks and private investors to help distressed shipping companies.

Container ship company Hanjin Shipping plans to sell 20 ships, writes the Financial Times.

The company owns 31 container ships, according to Paris-based AXS Marine, and 13 dry bulk ships.

Meanwhile, Hyundai Merchant Marine, which owns about 30 ships, plans to sell six vessels to the fund, according to KAMCO.

The fund aims to avoid the panic selling among Korea’s shipowners that broke out following the 1997-98 Asian financial crisis, when many vessels were sold to foreign companies, writes the Financial Times.